Serica Energy (AIM:SQZ) has completed its acquisition of a portfolio of Southern North Sea gas assets from Spirit Energy and affiliates.
The company paid a net £33m ($43m) to Spirit Energy, reflecting upfront consideration of £57m ($75m) reduced by interim post-tax cashflows accrued between the deal's effective economic date of 1 January 2025 and the 1 October completion date.
Serica said the transaction adds around 10,000 barrels of oil equivalent per day (boepd) to its production base, delivering near-term cash generation.
Free cash flow from the acquired assets is now forecast to exceed $200m by the end of 2028, more than double the expectation set when the deal was announced in December 2025, which the company attributed to a stronger gas price outlook, robust production, and the rephasing of some interim-period cash flows into the period after completion.
The acquired portfolio carries 18.7m barrels of oil equivalent (mmboe) of 2P reserves and 3.4 mmboe of 2C resources as at the effective date, based on an independent evaluation by Sproule ERCE.
It includes a 15% non-operated stake in the Cygnus field, one of the UK Continental Shelf's largest producing gas fields, a 25% non-operated interest in Clipper South, operated positions across the Greater Markham Area, and further interests across Southern North Sea gas fields; Spirit Energy retains decommissioning liabilities on the operated assets, expected to account for more than 75% of the total estimated liability.
"This is an excellent transaction for Serica: it is immediately cash generative, strengthens our position in the UK gas market and adds a significant new Southern North Sea hub to our portfolio," said chief executive Chris Cox, adding that the value case "has strengthened materially since announcement."
Production from the acquired assets will now be reported as Serica's Southern North Sea Hub, with the company saying it will move quickly into integrating new colleagues based in Hoofddorp in the Netherlands and Aberdeen.